Dams et al. v. TD Home and Auto Insurance Company
[Indexed as: Dams v. TD Home and Auto Insurance Co.]
Ontario Reports
Court of Appeal for Ontario,
Blair, Hourigan and D.M. Brown JJ.A.
January 6, 2016
129 O.R. (3d) 226 | 2016 ONCA 4
Case Summary
Insurance — Relief from forfeiture — Plaintiff failing to comply with police report and accident statement requirements in s. 3 of Schedule to Uninsured Automobile Coverage Regulation within stipulated times — Motion judge not erring in granting relief from forfeiture under s. 129 of Insurance Act — Failure to give timely notice of claim under insurance policy constituting imperfect compliance with statutory condition as to [page227] proof of loss — Section 8(1) of Schedule not transforming all requirements imposed on claimant by Schedule into conditions precedent to claim, for which relief from forfeiture is not available — Insurance Act, R.S.O. 1990, c. I.8, s. 129 — Uninsured Automobile Coverage, R.R.O. 1990, Reg. 676, Schedule, s. 8(1).
The plaintiff brought an action against his automobile insurer seeking damages under the uninsured automobile coverage provisions of his policy for injuries allegedly caused by an unidentified motorist. The defendant argued that the plaintiff was prohibited from bringing the action because he had failed to comply with the police report and accident statement requirements in s. 3 of the Schedule attached to the Uninsured Automobile Coverage Regulation in a timely manner. The trial judge granted the plaintiff relief from forfeiture in respect of his non-compliance. The trial judge allocated 60 per cent of the responsibility for the accident against the plaintiff and 40 per cent against the driver of the unidentified vehicle. The defendant appealed. The plaintiff cross-appealed on the issue of the apportionment of liability.
Held, the appeal and cross-appeal should be dismissed.
The failure to give timely notice of a claim under an insurance policy constitutes imperfect compliance with a statutory condition as to the proof of loss, rather than breach of a condition precedent to a claim. Section 8(1) of the Schedule does not transform all the requirements imposed on a claimant by the Schedule into conditions precedent to a claim, for which relief from forfeiture is not available. Relief from forfeiture under s. 129 of the Insurance Act is available where a claimant has failed to meet the time periods for the reporting requirements set out in s. 3 of the Schedule.
The trial judge did not err in his allocation of liability for the accident.
Falk Bros. Industries Ltd. v. Elance Steel Fabricating Co., 1989 38 (SCC), [1989] 2 S.C.R. 778, [1989] S.C.J. No. 97, 62 D.L.R. (4th) 236, 99 N.R. 228, [1990] 1 W.W.R. 29, J.E. 89-1362, 80 Sask. R. 22, 39 C.C.L.I. 161, 35 C.L.R. 225, [1989] I.L.R. Â1-2506 at 9709, 17 A.C.W.S. (3d) 700, apld
Other cases referred to
Fiddler v. Vasilakos, [2014] O.J. No. 4666, 2014 ONSC 5774 (S.C.J.); Hynna v. Peck, [2009] B.C.J. No. 1569, 2009 BCSC 1057, 99 B.C.L.R. (4th) 357, 87 M.V.R. (5th) 83,180 A.C.W.S. (3d) 185; Kozel v. Personal Insurance Co. (2014), 119 O.R. (3d) 55, [2014] O.J. No. 753, 2014 ONCA 130, [2014] I.L.R. I-5636, 31 C.C.L.I. (5th) 171, 372 D.L.R. (4th) 265, 315 O.A.C. 378, 61 M.V.R. (6th) 1, 237 A.C.W.S. (3d) 479; Stuart v. Hutchins (1998), 1998 7163 (ON CA), 40 O.R. (3d) 321, [1998] O.J. No. 3672, 164 D.L.R. (4th) 67, 113 O.A.C. 12, 6 C.C.L.I. (3d) 100, [1999] I.L.R. I-3619, 82 A.C.W.S. (3d) 782 (C.A.); Williams v. York Fire & Casualty Insurance Co. (2007), 86 O.R. (3d) 241, [2007] O.J. No. 2517, 2007 ONCA 479, 225 O.A.C. 157, 51 C.C.L.I. (4th) 177, [2007] I.L.R. I-4613, 158 A.C.W.S. (3d) 820
Statutes referred to
Courts of Justice Act, R.S.O. 1990, c. C.43, s. 98 [as am.]
Highway Traffic Act, R.S.O. 1990, c. H.8, ss. 128 [as am.], 136(1), (b), 150(1), 154(1)(a) [as am.]
Insurance Act, R.S.O. 1990, c. I.8, ss. 129, 265(1)
The Saskatchewan Insurance Act, R.S.S. 1978, c. S-26 [as am.]
Rules and regulations referred to
Uninsured Automobile Coverage, R.R.O. 1990, Reg. 676, Sch., ss. 3, (2), (3), 6, 8(1) [page228]
APPEAL AND CROSS-APPEAL from the judgment Sloan J. of the Superior Court of Justice dated November 13, 2014.
Dwain C. Burns, for appellant/respondent on cross-appeal.
Matthew A. Caldwell and Christopher J. Haber, for respondents/appellants on cross-appeal.
The judgment of the court was delivered by
D.M. BROWN J.A.: —
Overview
[1] On July 26, 2009, the respondent Wolfgang Dams and his friend, Gary Black, were riding their motorcycles along Old Bronte Road in Oakville, Ontario. Mr. Dams stopped his motorcycle at the intersection of Old Bronte Road and Bronte Road -- a four-lane divided highway -- preparing to make a right-hand turn onto Bronte Road. Mr. Black stopped his bike behind that of Mr. Dams.
[2] According to Mr. Dams, he looked to his left and saw a cube van approaching in the northbound passing lane about 100 yards to the south and a red vehicle in the curb lane much further to the south. He turned his bike's front wheel slightly to the right and began to pull out very slowly. When he took a further glance to the left, he saw a dark vehicle approaching in the curb lane which would have hit him had he proceeded onto Bronte Road. Mr. Dams braked, but the angle of his front wheel, combined with his slight forward momentum, caused his bike to fall on him. He suffered an ankle injury.
[3] At the time of the accident, Mr. Dams was insured under an automobile insurance policy issued by the appellant, TD Home and Auto Insurance Company ("TD Home"). In October 2009, Mr. Dams applied to TD Home for certain accident benefits, which he received. Then, in May 2010, Mr. Dams commenced a tort action against TD Home seeking damages under the uninsured automobile coverage provisions of his policy.
[4] At trial, TD Home argued that Mr. Dams was prohibited from bringing his action because he had failed to comply with certain reporting provisions in his policy. The trial judge rejected that defence and granted Mr. Dams relief from forfeiture in respect of his non-compliance. The trial judge assessed liability by allocating 60 per cent of the responsibility for the accident against Mr. Dams and 40 per cent against the driver of the unidentified vehicle.
[5] TD Home appeals from both findings. It submits that the trial judge erred in granting Mr. Dams relief from forfeiture. It also appeals from the apportionment of liability, contending that [page229] the trial judge erred in finding negligence on the part of the unidentified driver. Mr. Dams cross-appeals on the issue of liability, arguing that the trial judge erred in finding any liability against him.
[6] For the reasons set out below, I would dismiss the appeal and cross-appeal. The trial judge possessed the jurisdiction under s. 129 of the Insurance Act, R.S.O. 1990, c. I.8 to grant Mr. Dams relief from forfeiture related to his failure to comply in a timely fashion with certain reporting requirements concerning uninsured automobile coverage. On the issue of liability, it was open to the trial judge on the evidence before him to make the findings he did, and to apportion liability accordingly.
First issue: Did the trial judge err in granting relief from forfeiture?
The issue stated
[7] There is no dispute that Mr. Dams failed to comply with two reporting requirements prescribed by the statutory regime for accidents involving unidentified automobiles. Section 3 of the Schedule attached to the Uninsured Automobile Coverage regulation, R.R.O. 1990, Reg. 676 (the "Schedule") made under the Insurance Act imposes several obligations on a person insured under a contract of insurance who claims that an unidentified automobile has caused that person bodily harm or injury. Two of those obligations are that
(i) the person must report the accident to a police officer within 24 hours after it occurs, or as soon as is practicable after that time: s. 3(2); and
(ii) the person must give the insurer a written statement within 30 days after the accident occurs, or as soon as is practicable after that date, setting out the details of the accident: s. 3(3).
Both obligations are also set out in s. 5.3.5 of the Ontario Automobile Policy ("O.A.P. 1").
[8] Section 8(1) of the Schedule states that "[n]o person is entitled to bring an action to recover an amount provided for under the contract, as required by subsection 265(1) of the Act, unless the requirements of this Schedule with respect to the claim have been complied with". Section 5.9 of O.A.P. 1 reproduces the substance of s. 8(1).
[9] Mr. Dams did not notify TD Home about the accident until October 14, 2009, some two and a half months after the accident. Based on the information it received, TD Home treated the [page230] matter as an accidents benefits case and did not conduct any investigation.
[10] The trial judge found that Mr. Dams had no idea that he could bring an action for his pain and suffering until he had a chance meeting with a lawyer in February 2010. He thereupon tried to file a report with the police, but the police essentially told him it would be no use at that point of time. Mr. Dams then sent a statutory declaration to TD Home, some six months after the accident.
[11] Although Mr. Dams failed to comply with the police report and accident statement information requirements within the times stipulated by the Schedule, he sought relief from forfeiture of unidentified automobile coverage under s. 129 of the Insurance Act and s. 98 of the Courts of Justice Act, R.S.O. 1990, c. C.43. Those sections provide:
- Where there has been imperfect compliance with a statutory condition as to the proof of loss to be given by the insured or other matter or thing required to be done or omitted by the insured with respect to the loss and a consequent forfeiture or avoidance of the insurance in whole or in part and the court considers it inequitable that the insurance should be forfeited or avoided on that ground, the court may relieve against the forfeiture or avoidance on such terms as it considers just.
- A court may grant relief against penalties and forfeitures, on such terms as to compensation or otherwise as are considered just.
[12] The trial judge granted Mr. Dams relief from forfeiture.
Positions of the parties
[13] TD Home submits that the trial judge erred in granting Mr. Dams relief from forfeiture. Coverage for damages caused by unidentified automobiles is "subject to the terms, conditions, provisions, exclusions and limits as are prescribed by the regulations": Insurance Act, s. 265(1). TD Home argues that the two reporting requirements contained in s. 3 of the Schedule are preconditions to being able to commence an action for unidentified coverage, as stated by s. 8(1) of the Schedule and s. 5.9 of O.A.P. 1. TD Home contends that relief from forfeiture for Mr. Dams is not available under s. 129 of the Insurance Act or s. 98 of the Courts of Justice Act because those provisions can only relieve from imperfect compliance with a policy term, not from non-compliance with conditions precedent to a claim, such as those contained in s. 3 of the Regulation. [page231]
[14] Mr. Dams submits that relief under s. 129 of the Insurance Act or s. 98 of the Courts of Justice Act is available in the circumstances of this case because the case law has treated the failure to give timely notice of a claim as imperfect compliance with a term of a policy, not a condition precedent to a claim. Further, Mr. Dams provided a reasonable explanation for his failure to comply promptly with the reporting requirements, and the trial judge found that TD Home did not suffer any prejudice as a result of those delays.
Analysis
[15] The starting point for the analysis is the decision of the Supreme Court of Canada in Falk Bros. Industries Ltd. v. Elance Steel Fabricating Co., 1989 38 (SCC), [1989] 2 S.C.R. 778, [1989] S.C.J. No. 97. In that case, Elance Steel Fabricating Co. claimed against a surety company under a bond on account of a debt due from Falk Bros. Elance gave notice of its claim 28 days after the expiry of the notice period specified in the bond. The case required the Supreme Court to interpret a section in The Saskatchewan Insurance Act, R.S.S. 1978, c. S-26, identical in language to s. 129 of the [Ontario] Insurance Act.
[16] The Supreme Court observed, at p. 782 S.C.R., that sections like s. 129 are remedial in nature and "as such should be given an appropriately broad interpretation". The purpose of allowing relief from forfeiture in insurance cases "is to prevent hardship to beneficiaries where there has been a failure to comply with a condition for receipt of insurance proceeds and where leniency in respect of strict compliance with the condition will not result in prejudice to the insurer": at p. 783 S.C.R. However, the court's power under provisions like s. 129 only extends to cases "of such statutory conditions as to proof of loss or other matters or things that are required to be done or omitted with respect to the loss": at p. 786 S.C.R.
[17] The court then addressed the question of whether the failure to give notice of a claim under an insurance policy amounted to "imperfect compliance with a statutory condition as to the proof of loss", in which case relief under the statutory provision would be available, or whether it was non-compliance or breach of a condition precedent, in which case there could be no relief. It concluded, at pp. 785-86 S.C.R., that the failure to give notice of a claim in a timely fashion constitutes "imperfect compliance with a statutory condition as to the proof of loss" and falls within the terms of the relief provision. By contrast, the failure to institute an action within the prescribed time period would be a more serious breach, akin to non-compliance. Because Elance's failure to [page232] give notice of its claim within the prescribed time constituted imperfect compliance rather than non-compliance, Elance was eligible to claim relief from forfeiture.
[18] In the years following Falk Bros., this court has re-affirmed on several occasions that the discretion possessed by a court under s. 129 of the Insurance Act is limited only to those policy conditions -- statutory or contractual -- that relate to proof of loss: Williams v. York Fire & Casualty Insurance Co. (2007), 86 O.R. (3d) 241, [2007] O.J. No. 2517, 2007 ONCA 479, at para. 33; Kozel v. Personal Insurance Co. (2014), 119 O.R. (3d) 55, [2014] O.J. No. 753, 2014 ONCA 130, at para. 35. The court's power under s. 129 concerns things or matters required to be done in relation to the loss -- i.e., to instances of imperfect compliance with the terms of a policy after a loss has occurred: Williams, at para. 33; Kozel, at para. 58.
[19] TD Home argues that the reporting requirements contained in s. 3 of the Regulation are akin to conditions precedent in the nature of limitation periods, because s. 8(1) of the Regulation provides that no person can bring an action to recover an amount under the contract of insurance "unless the requirements of this Schedule with respect to the claim have been complied with".
[20] I am not persuaded by this argument, for two reasons. First, the decision of the Supreme Court in Falk Bros. stands squarely against it. The reporting requirements contained in s. 3 of the Schedule are functionally similar to the notice of claim requirement at issue in Falk Bros. Both operate with the view of providing the insurer with timely information about the loss so that it can investigate the matter, if it so chooses. The nature of Mr. Dams's failure to comply in the present case clearly falls within the class of cases covered by the statutory language in s. 129 -- i.e., a statutory condition as to the proof of loss to be given to the insured or other matter or thing required to be done omitted by the insured with respect to the loss.[^1]
[21] Second, to assess the effect of s. 8(1) of the Schedule on the availability of relief under s. 129 of the Insurance Act, the Schedule must be read in its entirety. Section 8(1) applies to all the requirements of the Schedule concerning uninsured automobile coverage. In addition to the reporting requirements imposed [page233] by s. 3, the Schedule also requires a person entitled to make a claim to give notice of the claim and to provide a proof of claim: s. 6. To accept the interpretation of s. 8(1) advanced by TD Home would result in that section of the Schedule precluding relief from forfeiture for imperfect compliance with the obligation to provide a proof of loss, a matter for which s. 129 specifically affords relief from forfeiture. Such an interpretation of the Schedule would run counter to the very purpose of the statutory provision. In my view, such an untenable interpretation signals that s. 8(1) of the Schedule does not transform all the requirements imposed on a claimant by the Schedule into conditions precedent to a claim for which relief from forfeiture is not available. Instead, s. 8(1) must be read in the light of s. 129 of the Insurance Act and the principles set down by the Supreme Court in the Falk Bros. case. When so read, relief from forfeiture under s. 129 of the Insurance Act is available where a claimant has failed to meet the time periods for the reporting requirements set out in s. 3 of the Schedule.
[22] Consequently, the trial judge did not err in holding that Mr. Dams was entitled to claim relief from forfeiture under s. 129 of the Insurance Act in respect of his failure to make a report to the police and to provide an accident statement to TD Home within the times stipulated by s. 3 of the Schedule. Since TD Home limited its argument to the jurisdiction of the trial judge to grant relief from forfeiture and did not contend that the trial judge had failed to look at all relevant factors when considering whether to grant relief from forfeiture, the conclusion that the trial judge could grant relief from forfeiture under s. 129 disposes of this part of the appeal.
Second issue: Did the trial judge err in his apportionment of liability for the accident?
The positions of the parties
[23] TD Home submits that the trial judge erred in apportioning any liability against the unidentified driver because there was no evidence of any negligence on the part of the unidentified driver. TD Home argued that the unidentified driver was proceeding lawfully northbound on Bronte Road; it had the right of way as it approached the uncontrolled intersection of Old Bronte Road and Bronte Road; there was no evidence that it failed to keep a proper lookout as it approached the intersection; it was entitled to move into the curb lane; and there was no evidence that it was making a passing manoeuvre in the curb lane as it approached the intersection. [page234]
[24] Mr. Dams submits that the trial judge erred in apportioning any liability against him because the unidentified driver was the sole cause of the accident: the dark vehicle was speeding when it was passing the cube van in the curb lane; and the unidentified driver failed to yield the right of way to Mr. Dams by quickly moving into the curb lane just as Mr. Dams was planning lawfully to enter Bronte Road.
Analysis
[25] Several rules of the road were in play when Mr. Dams stopped his motorcycle before entering onto Bronte Road from Old Bronte Road and as the unidentified driver approached that intersection.
[26] Mr. Dams was required to stop his motorcycle at the marked stop line on Old Bronte Road and yield the right of way to traffic "approaching the intersection on another highway so closely that to proceed would constitute an immediate hazard": Highway Traffic Act, R.S.O. 1990, c. H.8 ("HTA"), s. 136(1). Having so yielded the right of way, Mr. Dams was entitled to proceed onto Bronte Road: HTA, s. 136(1)(b).
[27] Although the unidentified driver who was proceeding northbound on Bronte Road had the right of way over Mr. Dams as he approached the intersection, the unidentified driver was subject to several obligations:
(i) the driver was not entitled to drive his vehicle from the passing lane to the curb lane unless "the driver first ascertains that it can be done safely": HTA, s. 154(1)(a);
(ii) the driver was entitled to overtake and pass to the right of the cube vehicle which was in the passing lane "only where the movement can be made in safety": HTA, s. 150(1);
(iii) the driver was required to obey the posted speed limit of 60 km/hour: HTA, s. 128; and
(iv) when approaching the intersection, the driver was required to maintain a proper lookout and proceed with such care and prudence through the intersection as appropriate in the particular circumstances: Fiddler v. Vasilakos, [2014] O.J. No. 4666, 2014 ONSC 5774 (S.C.J.), at para. 28; Hynna v. Peck, [2009] B.C.J. No. 1569, 2009 BCSC 1057, at para. 81.
[28] TD Home submits there was no evidence before the trial judge which would entitle him to find that the unidentified driver was negligent when approaching the intersection. Mr. Dams contends that there was no evidence to support [page235] a finding that he was negligent when he slowly moved forward from the stop sign towards Bronte Road.
[29] I do not accept either submission.
[30] In respect of the unidentified driver, the trial judge made several findings of fact:
(i) as the unidentified driver approached the intersection, the driver would have had a plain view of the motorcycle which was moving forward;
(ii) although the unidentified driver had the right of way to change lanes into the curb lane, the driver should have proceeded with the utmost caution for two reasons: (a) the driver would have seen the two motorcycles, one of which was creeping forward; and (b) in the area just north of the intersection, several residential driveways exited onto Bronte Road; and
(iii) the utmost caution the driver should have exercised included reducing the speed of the vehicle or moving back into the passing lane until it passed the motorcycles.
On the evidence before the trial judge, including the opinion evidence of the expert accident reconstruction expert, those findings were open to the trial judge to make.
[31] Although Mr. Dams testified that when he first looked to his left to check the approaching traffic he had not seen the dark vehicle following the cube van in the passing lane, the trial judge did not accept his evidence. The trial judge accepted the evidence of Mr. Black that when he was stopped at the stop sign, he could see the dark vehicle come from behind the cube van in the passing line. The trial judge also accepted the evidence of the accident reconstruction expert that even under the worst visibility circumstances, part of the dark vehicle would have been visible to Mr. Dams. From that evidence, the trial judge found that Mr. Dams should have seen at least part of the dark vehicle as it followed the cube van in the passing lane and before it moved into the curb lane. It was open to the trial judge to make those findings on the evidence before him.
[32] Those findings by the trial judge of negligence on the part of both the unidentified driver and Mr. Dams entitled him to apportion liability for the accident. The trial judge described the case as "a difficult one to assess". Nevertheless, in light of the careful findings of fact which he made, I see nothing unreasonable in the trial judge's allocation of 60 per cent liability to Mr. Dams given that s. 136(1)(b) of the Highway Traffic Act required him [page236] to yield the right of way to the dark vehicle which, in the circumstances, constituted an "immediate hazard" approaching the intersection. I see no basis for appellate interference in the trial judge's allocation of liability between the parties.
Disposition
[33] For the reasons set out above, I would dismiss the appeal and cross-appeal.
[34] The parties agreed that the successful party would be entitled to costs of the appeal in the amount of $10,000. Since the respondents enjoyed the greater success on the appeal, I would award them their costs of the appeal in the amount of $10,000, inclusive of HST and disbursements.
Appeal and cross-appeal dismissed.
Notes
[^1]: The type of policy in issue can affect how a court treats the breach of a reporting requirement. For example, in Stuart v. Hutchins (1998), 1998 7163 (ON CA), 40 O.R. (3d) 321, [1998] O.J. No. 3672 (C.A.), this court held that relief from forfeiture under s. 129 of the Insurance Act was not available for a failure to report a claim where the policy of insurance was a "claims made and reported" policy, not an "occurrence" policy. See, also, Kozel, at para. 44.
End of Document